Itemized deductions can significantly reduce your taxable income, potentially lowering the amount of tax you owe. However, claiming these deductions requires careful tracking of eligible expenses and can be more complex than taking the standard deduction. This guide explains what itemized deductions are, which expenses qualify, and how to claim them on your tax return.

What Are Itemized Deductions?

Itemized deductions allow taxpayers to subtract specific expenses from their Adjusted Gross Income (AGI), reducing their taxable income. Unlike the standard deduction—a fixed amount based on filing status—itemizing deductions lets you claim eligible expenses if they exceed the standard deduction amount.

Common itemized deductions include:

• Mortgage interest
• State and local income taxes (SALT)
• Medical and dental expenses
• Charitable donations

Taxpayers must choose between the standard deduction or itemizing, depending on which option results in a lower taxable income.

Standard vs. Itemized Deductions

The Tax Cuts and Jobs Act (TCJA) of 2017 significantly impacted tax deductions by increasing the standard deduction amount, making itemizing less common. For tax years 2018 through 2025, the higher standard deduction means fewer taxpayers benefit from itemizing, as their qualifying expenses often fall below the standard deduction threshold.

Additionally, the TCJA eliminated certain deductions and modified others. The personal exemption was removed, but the child tax credit doubled, benefiting more families. Taxpayers must carefully evaluate whether itemizing or taking the standard deduction will yield greater tax savings.

Common Types of Itemized Deductions

Itemized deductions are reported on Schedule A of the IRS Form 1040. Common deductions include:

• Medical and Dental Expenses: You can deduct unreimbursed medical and dental expenses exceeding 7.5% of your AGI. These expenses must be for yourself, your spouse, or your dependents.
• Long-Term Care Insurance Premiums: Premiums exceeding 10% of your AGI may be deductible, with limits based on age and IRS qualifications.
• Mortgage Interest: Interest on mortgages up to $750,000 for primary and secondary homes is deductible. For mortgages originated before December 16, 2017, the limit is $1 million. Points paid during home purchases or refinancing may also be deductible.
• State and Local Taxes (SALT): You can deduct up to $10,000 in combined state and local income, sales, and property taxes. Foreign real estate taxes are not deductible.
• Charitable Donations: Donations to qualified charities are deductible up to 60% of your AGI. Excess contributions can often be carried forward to future years.
• Casualty and Theft Losses: Losses from federally declared disasters may be deductible if they exceed 10% of your AGI after subtracting a $100 threshold.
• Miscellaneous Deductions: Certain expenses, like gambling losses (up to the amount of winnings) and estate taxes on income in respect of a decedent (IRD), are deductible. Job-related expenses are only deductible for specific categories of workers, such as armed forces reservists and performing artists, using Form 2106.

How to Claim Itemized Deductions

To claim itemized deductions, gather documentation of all eligible expenses, including receipts, statements, and charitable contribution acknowledgments. Compare the total of your itemized deductions to your standard deduction to determine which option provides the greatest tax benefit.

For 2024 and 2025, the standard deduction amounts by filing status are:

Filing Status	2024 Standard Deduction	2025 Standard Deduction
Single	$14,600	$15,000
Married Filing Joint	$29,200	$30,000
Head of Household	$21,900	$22,500

If your itemized deductions exceed the standard deduction, report them on Schedule A and transfer the total to your Form 1040 to reduce your taxable income.

Should You Itemize or Take the Standard Deduction?

Deciding whether to itemize depends on your personal tax situation. If your itemized deductions are higher than the standard deduction for your filing status, itemizing will likely lower your tax bill. However, itemizing requires more paperwork and increases the likelihood of an IRS audit, especially if your deductions seem unusually high compared to your income.

Non-Cash Charitable Contributions

When donating non-cash items such as clothing, household goods, or vehicles, obtain a written acknowledgment from the charity detailing the donation’s name, date, and value. If your non-cash contributions exceed $500, file Form 8283 with your return.

The Bottom Line

Itemizing deductions can yield significant tax savings, but it requires meticulous recordkeeping and an understanding of IRS rules. If you’re uncertain whether itemizing is right for you, consulting a tax professional can help you make the best decision. The IRS website also offers helpful resources to guide you through the tax filing process.